Paytm Mall, a subsidiary of One97 Communications has begun shutting down its warehouses aiming to transition to a true marketplace, as per provisions in the FDI policy for e-commerce firms, Economic Times has reported.
The company is hoping that it will help it reduce costs and also bring down the cost and time of deliveries. The sellers on the platform will begin deliveries through local courier services.
“In 2017-18 we were doing a course correction. In this business, one can only be profitable if one becomes a true marketplace and not follow an inventory-based model because the latter comes with the baggage of high costs. Both our partners, eBay and Alibaba are making money,” Rudra Dalmia, senior VP and CFO of Paytm Mall said.
The company, the e-commerce arm of larger Paytm group, is now valued at $3 billion after having raised $165 million from eBay for a 5.5 per cent stake. It has emerged as India’s third largest e-retailer after Flipkart and Amazon.
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